Housing Growth Plan Part of the strategic plan for the Isles of Scilly May 2014 - Council of the ISLES OF SCILLY
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Housing
Growth Plan
Part of the strategic plan for the
Isles of Scilly
May 2014!
CONTENTS
!
Page
Summary
2
The population
3
The current housing stock
5
Supply of housing
6
How affordable is housing on the Islands?
7
Future housing demand and the supply to meet this
9
Planning policy as a context for housing provision
11
Funding for housing
13
Towards an Action Plan
15
This report has been prepared by: In association with:
ASH FUTURES LTD
strategy, futures, sustainability, change
1 Isles of Scilly Housing Growth PlanTHE HOUSING GROWTH PLAN
The Housing Growth Plan sets out a vision for housing development in the Isles of Scilly over the next 10 years.
The Growth Plan concludes that more new homes are required on the Islands to meet the needs of the local
community and to support sustainable economic growth. It makes an early estimate of the potential scale and
type of the new housing to be planned for - but more detailed analysis and debate is required to refine these.
The estimates shown in the Plan are based on the best available information, but they should not be treated as
a fully-worked-up housing plan. They are the start of a process.
!
SUMMARY
Housing supply on the Isles of Scilly is very limited and new construction is very restricted. The lack of supply
and the local housing policies are designed partly to prevent overdevelopment in an area of special
environmental quality, and partly to ensure that people who live and work on the islands are able to find places
to live.
As a consequence, there are serious issues with affordability and availability. This affects both the local
community and the wider economy, as it is difficult to attract staff and potential entrepreneurs. At the same
time, the population has been increasing and getting older which puts more pressure on the available housing
stock.
We believe that there are a number of reasons why the existing planning and housing policies should be
relaxed.
1. It is unlikely that the same level of grants for social housing will be available in the future. Therefore,
securing more social housing for local people will require an element of cross-subsidy from more open
market housing.
2. The new National Planning Policy Framework requires local planning policies to consider the need for
all types of housing - of different sizes, types and tenures.
3. There remains considerable local demand for social housing and an increased choice of homes for
private rent and sale.
4. The economy of Scilly needs to grow in order to sustain the viability of local services and, ultimately, of
the local communities. It would be prudent to allow for a modest level of new development to attract
new entrepreneurs and staff to the islands.
We are fully aware of the need to maintain the special nature of the environment. We suggest that
development should be focused, in the first instance, on sites which are already identified, and then to other
brownfield sites. Only then should any new locations be identified - which, we would suggest, should support
existing or new settlements and be located carefully so as not to affect any environmentally sensitive sites.
As a result, we are estimating that provision should be made for between 90 and 120 new homes on Scilly
over the next 10 years - this is only slightly higher than the number of homes built during the last 10 years. We
suggest that these preliminary figures be kept under review to take account of any substantial increase or
decrease in population size, and any changes in government housing policy and funding arrangements.
!
2 Isles of Scilly Housing Growth Plan1. THE POPULATION
Headlines
The population of the Isles of Scilly today is about 2,200 and has been growing slowly over the last 30 years.
The population is ageing and is older than the national average – most older people are owner-occupiers and
1 in 5 households on the Islands is an owner-occupier aged over 64 years.
There is evidence that many young people, in their 20s, do not return from mainland education.
There are 2,200 people living on the Isles of Scilly, of which just over 1,700 live on St Mary’s. The number of
people living on the off-islands is estimated at:
• 175 on Tresco
• 135 on St Martin’s
• 170 on Bryher and St Agnes
The population of the Islands declined in the 1980s but has been slowly increasing since then, with nearly all of
the growth being on St Mary’s.
Figure 1: Population change 1971 to 2011
3000
St Mary's Off Islands
2250
1500
750
0
1971 1981 1991 2001 2011
Source:
Census data provide by the Isles of Scilly Council
!
In the same way as is happening nationally, the population is ageing. The chart below compares the age
structure of the Islands’ population with that of Cornwall and England and Wales. For this analysis, we have
taken out 16 to 19 year olds because they mostly would have been in education on the mainland at the date of
the Census.
3 Isles of Scilly Housing Growth PlanFigure 2: Age Structure of the population
30 Isles of Scilly
Cornwall
England and Wales
20
Percentage
10
0
0-15 20-29 30-34 45-64 65-84 85 or over
!
The chart shows that:
• There is evidence to suggest that many young people in their 20s stay on the mainland at the end of
their education, but we do not know whether this is due to difficulties in finding affordable housing on
the Islands or other reasons;
• Older people of working age (looking across the 30 to 64 age range) represent about the same
percentage of the population as found nationally, suggesting a normal workforce for the size of
population;
• The Isles of Scilly, like Cornwall, has a relatively high proportion of older people – both those 65-84
years and people aged 85 and over. It is this latter group where there is a higher likelihood of
additional care needs.
The 2011 Census highlights that there is a concentration of older people in the owner-occupied sector. 22% of
the total population are older owner-occupiers and this will have implications for the type of housing for older
people that needs to be planned for in the next 10 years.
Figure 3: Older people in the population by tenure (as % of the total population)
20
65 - 84 85 or over
15
10
5
0
Owned Affordable housing Private rented
! Source:
2011 Census
!
!
4 Isles of Scilly Housing Growth Plan2. THE CURRENT HOUSING STOCK
Headlines.
There are 1,375 dwellings on the Islands of which one third are holiday lets or second homes
The percentage of owner-occupied dwellings is lower than on the mainland, but there is a much greater
reliance on private rented housing
There are 1,375 dwellings on the Islands which are made up as :
990 dwellings
permanently occupied stock1
195 dwellings
second homes2
190 dwellings
other properties – assumed to be holiday lets / time shares, etc.
Second homes and other holiday accommodation therefore represent about 30% of the total housing stock. In
a national context this is an exceptionally high figure – only eclipsed by the City of London. Second home
ownership in the Islands is about three times higher than for Cornwall as a whole, although there may be
individual Cornish towns and villages, of a similar size to the Isles of Scilly, that have as many second and holiday
homes.3
The tenure of the permanently occupied stock is very different in the Islands compared with Cornwall. This is
illustrated in the chart below, which shows that owner occupation is relatively under-represented but there is
much more private rented housing than is typical of the mainland. In this chart, affordable housing is defined as
social rent and shared ownership housing provided by the Council or a housing association.
Figure 4: Tenure of permanently occupied stock
70
Isles of Scilly Cornwall
52.5
Percentage
35
17.5
0
Owned Affordable Housing Private rented Living rent-free
! Source:
2011 Census
!
!
Recorded as 989 in the 2011 Census
1
Council tax records
2
3 Savills Research, Residential Property Focus Q2 2013. The data shown in the study gives a second home figure of 16.3% for the Isles of Scilly
and 5.7% for Cornwall – based on Savills’ analysis of council tax records.
5 Isles of Scilly Housing Growth Plan3. SUPPLY OF HOUSING
Headlines
Over the last 10 years, on average, there have been 10 new homes developed each year.
There is a small supply of relets and resales each year from the existing stock – about 30-35; of these, around
14 are homes for sale.
The annual housing supply has two sources – new development and relets and resales of the existing stock.
New development
Between 2004/5 and 2011/12, 81 new homes were built on Scilly. If this rate of housebuilding were sustained
over the next 10 years, that would be the equivalent of about 100 new homes.4
Relets and resales from the existing stock
The existing stock provides a small supply of housing available for permanent occupation each year – for resale
or reletting (but resales of market housing can be taken up by second home owners or as holiday lets).
Sources of supply from the existing stock are shown in the table below. The information is a best estimate
drawn from a number of sources and there may be better data available to help refine these numbers.
Figure 5: Sources of housing supply from the existing stock
Estimated annual supply
Social rented – council and housing association 8 - 10
Owner-occupied 12 to 14
Privately rented (including Duchy of Cornwall) 12
This very limited annual supply – around 30-35 dwellings – highlights the limited flexibility within the housing
market.
Demand for affordable housing (Council and housing association) is very high, with about 15 households on the
housing register for every relet. Allocation to affordable housing is managed by the Council, operating a strict
points system. This gives priority to households in different types of housing need (e.g. unintentionally homeless,
sharing with parents, in overcrowded accommodation, medical priority, separated families) but also gives points
to households born on the Islands and to those not born on the Islands but resident for 20 out of the last 25
years. Using a points system ensures transparency; however, it is somewhat inflexible. The system does not
allow for any access to affordable housing for those needing to move to the Islands for economic or family
reasons.
There is also a stock of 30 properties available for letting to key workers, with a wide variety of owners.
Access to key worker accommodation (when a relet becomes available) is on an ad hoc basis, but in line with
procedures set out in ‘Key Worker Policy and Procedure Document, November 2012’.
Education Teachers
Health Doctors, Dentists, Nurses, Midwives, Paramedics and Pharmacists
Police Police Officers
Public Services Posts that are required to fulfil the statutory duties of the Council of the Isles of Scilly
Animal Welfare Veterinary Surgeons
Public Utilities Posts required to maintain public utilities on the islands
4 Council of the Isles of Scilly, Annual Monitoring Report (AMR) 2011/12
6 Isles of Scilly Housing Growth Plan4. HOW AFFORDABLE IS HOUSING ON THE ISLANDS?
Headlines
Although the market may be easing slightly, average sale prices remain very high and very few properties are
sold for less than £200,000. Local households on modest incomes will struggle to get onto the housing
ladder.
Council rented housing is affordable for nearly all households on the Islands. However, if future rented housing
was provided by the Council or housing associations as the new Affordable Rent tenure, it could only be
afforded by about half the Islands’ households.
Market housing is very highly priced. The overall average price of sale housing across the last two years was
£344,000. This is over £100,000 higher than the average for Cornwall (at £219,000).5 The analysis of recent
sales on the Islands demonstrate how prices vary by type of dwelling.
Average values for houses are £350,000 or above, with flats at an average value of just under £250,000. Of the
41 sales recorded by Land Registry from 2011 to 2013, only three properties sold for less than £200,000.
There are some signs and local agent advice that prices may be easing, with properties on the market at
reduced prices. Nevertheless, there are still only a handful of properties available at any time for less than
£200,000. This highlights the difficulties for local people on middle incomes of buying locally and getting on the
housing ladder.
Figure 6: Mean average market values Figure 7: Average rents by landlord (2012)
by property type 2011 to 2013
Housing type Average sale price (£) Ownership Average rents per week (£)
Flat 243,000 Council 70
Terrace 349,000 Housing Association 100
Semi-detached 359,000 Duchy of Cornwall 130 approx
Detached 403,000 Privately rented 160 approx
Source: Land Registry - freehold & leasehold properties
Source: Consultation Draft Tenancy Strategy 2013
!
Rents vary significantly with tenure and within tenures. For the affordable stock, there are differences in rents
between Council and housing association properties.
It is highly probable that any future provision of rented affordable housing (that relies on Homes and
Communities Agency funding) would need to be Affordable Rent housing.6 Rents for ‘this type of housing
would be higher than typical for today’s housing association and Council social rented housing: Affordable Rents
estimated at around £105 per week for a 2 bedroom home and £120 per week for a 3 bedroom home.7
!
5 DCLG Live Table 581 – mean average Q2 2013. This is not a direct comparison with the more detailed analysis of values in the Islands but is
a reasonable estimate to use.
6 This is made clear in the Homes and Communities Affordable Homes Programme 2015-18 Prospectus – January 2014 which states, “The
2015-18 Affordable Homes Programme . . . assumes that the main new supply product that will be delivered will be new Affordable Rent homes,
and, where appropriate, affordable home ownership (shared ownership) homes”, and later that “Social rent provision will only be supported in
very limited circumstances. For example, social rent could be considered where decanting existing social tenants into new homes is necessary”.
7 These rents are approximately 80% of the Local Housing Allowances (LHA ) for the nearest mainland area, which is a useful indicator. This is
the Broad Rental Market Area of Kernow West in Cornwall with LHA rates of £129 for a 2 bed dwelling and £150 per week for a 3 bed
dwelling.
7 Isles of Scilly Housing Growth PlanExtract from the Homes and Communities website
The Affordable Homes Programme signals a significant change and heralds the introduction of a new, more
flexible form of social housing, Affordable Rent, which will be the main type of new housing supply.
Affordable rented homes will be made available to tenants at up to a maximum of 80% of market rent and
allocated in the same way as social housing is at present. Landlords will have the freedom to offer Affordable
Rent properties on flexible tenancies tailored to the housing needs of individual households.
Affordability. Evidence about affordability is available from the 2013 Housing Needs Survey. The survey
collected information from only 70 households and so the results can only provide limited information about
affordability. The survey concluded that only 5.4% of the respondents could afford to buy an average-value
property (the average value being £305,000 according to the Survey report) and only around 13.5% could
afford £200,000 or more.8
The chart below, taken from the report, indicates that social rented housing is affordable by nearly every
household, but that if Affordable Rent housing was provided (at the increased rents of this tenure) it could only
be afforded by about half of households.
Figure 8. Extract from Housing Needs Survey 2012
40
What level of rent can you afford?
Percentage of survey
30
20
10
0
up to £75 £75-£100 £100-125 £125-150 £150-175 £175-200 Over £200
Rent budget per week Source: Altair. Jan 2013
!Intermediate housing. There is very little opportunity for those on modest incomes to get into the sale
housing market, and anecdotal evidence suggests that this causes some, mainly young, households to leave the
Islands or not to move in the first place to take up employment. Given the very high market values and
minimal supply of smaller cheaper properties, this is not surprising. There is very little, if any, intermediate
housing to help here to bridge the gap. On the mainland, in areas with very high house prices, one option is to
include some form of equity share housing in new developments. For example, a household could buy 70% of
the equity in a property and purchase the remaining 30% if and when they can afford the extra cost. If the
property is sold, it can be offered again to another household on an equity share basis.
See Figure 22 in Housing Needs Survey 2013
8
8 Isles of Scilly Housing Growth Plan5. FUTURE HOUSING DEMAND AND THE SUPPLY TO MEET THIS
Headlines
1. Meet local demand for new housing of about 100 to 110 new homes plus 10 to 15 new homes to
prepare for the impact of changing household size
2. Support the planned economic growth with another 10 to 15 homes
We are suggesting pulling back slightly from the maximum number suggested because of environmental
constraints. Therefore we are recommending that a provisional estimate of 90 to 120 new homes should be
planned for over the next 10 years.
However, these figures are only indicative and require more refinement and consideration before they are
made into a formal target. The Council should prepare its own demographic forecasts to help with this.
The new housing will meet the needs of a range of people, including those requiring affordable housing, local
young people who want to get on the housing ladder, older households requiring specialist provision, and
incoming key workers and entrepreneurs.
!
The Housing Growth Plan has built up an estimate of demand for housing over the next 10 years. This adds
together demand for housing from the local community and the need for housing to support economic
growth. It does not include demand from elsewhere not linked to economic growth.
The estimates of demand are based on the best available data but the Council is urged to draw up more
robust estimates (such as a Housing Market Assessment) before proceeding with any plans for more housing.
Demand for housing from the local community
Current demand for housing from the local community is measured in a number of ways. Sources include:
• Local housing register (for Council and housing association housing) - approximately 80-909
• Waiting list for other rented properties, approximately 40-50 10
• Market housing – market values indicate strength of demand and local agents’ view that demand from
local residents is becoming a higher proportion of overall demand
The above current unmet demand from the local community is therefore somewhere between 120 and 140
households plus demand for market housing. Some of this demand may be double counted and some of the
demand may be met through relets and resales of the existing stock. On this basis, it might be reasonable to
seek to meet demand for around 60-70 homes to 2020 (the end date of the Local Plan) and a maximum of
100-110 over the next 10 years.
There are no official population or household forecasts to indicate how many more homes will be needed in
the future to accommodate changes within the existing population. For the Housing Growth Plan, a very basic
estimate has been prepared simply to take account of changing household size. This is a very approximate
measure but does give an indication of internally generated household growth. If household size in the Islands
follows the same pattern as in Cornwall, it is projected that there will be another 10 households by 2021 and
about another 15 within the next 10 years.
Demand for housing to support economic growth
The other element of demand is to support economic growth.
The current stock of about 30 key worker properties is very limited and it is reported that there can be
difficulties finding suitable accommodation when it is required. Of the 46 businesses who answered the
question in our Business Survey, 10 stated that ‘lack of suitable housing held back recruitment’. This suggests
that, across the whole business base, the demand for accommodation for staff is considerable.
Isles of Scilly Council Allocations to both council and housing association properties are made by the council.
9
Author’s estimate based on expert views
10
9 Isles of Scilly Housing Growth PlanIt is very difficult to devise a suitable figure for new housing to support future economic growth but the
Housing Growth Plan includes an allowance of 10 to 15 new homes for this purpose, as a pilot scheme. Any
new housing to support economic growth will need to be kept under review and, in particular, monitor the
release of holiday let properties back into the open market.
Summarising the future housing supply
Bringing together the different elements of housing need, and taking account of environmental pressures,
produces an indicative figure for new housing of around 90 to 120 dwellings over the next 10 years. The table
below shows how this figure is built up, but it must be stressed that the numbers are only guidelines and will
need to be scrutinised in detail and revised before being adopted as a formal target.
Figure 9 Possible 10 year housing supply
Type of demand 6 years to 2020 For 10 years
Local demand 60 to 70 100 to 110
From the local Housing Register, those estimated to be on waiting lists for other rental
properties; those seeking local market housing for purchase; staff and key workers
Population increase 10 15
From changes in household size
Increase to support economic growth 5 to 10 10 to 15
This is made up from an estimate of potential new dwellings to meet demand from
incoming entrepreneurs and their staff
Maximum total 75 to 90 125 to 140
We recommend 60 to 90 90 to 120
Given the limited sites currently identified; and given the crucial need to preserve the
essential environmental quality of the Islands
Compared with last 10 years (estimated - from AMR 2011/12) 101 dwellings
Types of housing
There are several different housing needs to be met in the future which have been identified by the Housing
Growth Plan. These are outlined below but much more detailed analysis will be required to determine how
much of the future new supply is made available for each:
• Meeting the current need for affordable housing (which is found to be mainly from single people
and couples)
• Meeting the need for young local households to move to home ownership including some form of
equity share of smaller properties to bridge the gap
• Meeting the needs of key workers who will often be looking for good-quality private rent
opportunities as well as home ownership
• Market housing for economic growth
Housing for older people
The other group for whom new housing is likely to be needed over the next 10 years is older people. This
issue has been highlighted in the research with an apparent need for enhanced provision which spans the full
range from ‘down-sized’ mainstream housing through different levels of care provision to full nursing care (with
24-hour nursing provision).
The analysis of the population structure shows that the older people are mainly homeowners and future plans
need to reflect this. But there may also be issues of under-occupancy of affordable housing which also need to
be assessed and suitable alternatives provided.
There is limited information with which to plan for future provision and to deliver an integrated strategy that
includes both market and affordable provision, meets the different types of care needs, and is fundable.
10 Isles of Scilly Housing Growth Plan6. PLANNING POLICY AS CONTEXT FOR HOUSING PROVISION
Headlines
Planning for the Islands is guided by the current Local Plan which runs to 2020. The Plan does not allow the
development of open market housing, and private housing is only permitted if it can be shown to meet a
local need.
The Local Plan was published in 2006 and predates government guidance (the NPPF) which requires planning
authorities to consider future housing provision to meet the range of needs of the whole community – across
all tenures and types of household. This is an important change.
The Local Plan has already allocated sites for new housing – but some of these have not been developed.
Future development should make best use of redevelopment / brownfield sites (e.g. the Carn Thomas school
site) as well as the outstanding Local Plan allocations before new sites for development are identified.
!Overall policy approach
The future provision of housing will be shaped by the Local Plan. The current Isles of Scilly Local Plan (2005)
covers the period to 2020. It has allocated land for residential development but only permits development of
affordable housing or housing providing staff accommodation. No open market housing is permitted and any
private housing that is developed will be tied through a planning condition or obligation to meeting a local
need. Policy 3 sets this out:
POLICY 3 - HOUSING
1 To endeavour to ensure that housing is available to meet the needs of the community in perpetuity and to
promote sustainable communities on the inhabited islands, no general open market housing will be
permitted.
2 To ensure that suitable housing is available to meet the long term needs of the community, residential
development will only be permitted where it is required to meet:
a) an identified and recognised local need or to accommodate a key worker whose needs cannot be met by
the existing housing stock; or
b) the provision of staff accommodation for businesses on or near the premises where possible and where
it can be demonstrated that there is no other accommodation available and it is not possible to recruit
staff already housed on the islands.
3 All new residential development will be subject to secure arrangements to ensure that it remains
permanently available to meet the specific identified need that justified its original permission.
Source: Part of policy 3 from Isles of Scilly Local Plan adopted 2006
!
The purpose of the policy is to meet local need only – as this extract from the supporting text illustrates:
“In seeking to provide for the housing needs of the islands, the presumption will be to keep new housing development
to that required to meet specific local need generated from within the islands which cannot be met by the existing
housing stock.”
The very tightly constrained approach to housing provision (reflecting the very sensitive nature of the
environment and infrastructure constraints) predates publication of the National Planning Policy Framework
(NPPF) which requires planning authorities to take a ‘whole market approach’ to their assessment of housing
need and future provision. See NPPF example below.
The Local Plan was drafted at a very different time and significantly predates the NPPF. There are other parts
of the NPPF which ensure the protection of prized environments. But what the NPPF has introduced is a need
for planning authorities to consider future housing provision to meet the range of needs of the whole
community – across all tenures and types of household.
!
11 Isles of Scilly Housing Growth PlanNATIONAL PLANNING POLICY FRAMEWORK – para 50
To deliver a wide choice of high quality homes, widen opportunities for home ownership and create
sustainable, inclusive and mixed communities, local planning authorities should:
• plan for a mix of housing based on current and future demographic trends, market trends and the needs
of different groups in the community (such as, but not limited to, families with children, older people,
people with disabilities, service families and people wishing to build their own homes);
• identify the size, type, tenure and range of housing that is required in particular locations, reflecting local
demand; and . . .
Development opportunities
There are three sites allocated in the Plan, totalling 30 houses and all on St Mary’s. They are:
• 0.34 hectares adjoining Coastguard Bungalows, Telegraph capable of accommodating a minimum of 15
houses
• 0.36 hectares on the eastern side of McFarland’s Down north of the junction with Pungies Lane capable
of accommodating a minimum of eight houses
• 0.06 hectares of derelict farm buildings adjoining and to the south-east of Normandy Farmhouse
capable of accommodating a terrace of six units of social housing for rent
The site at Normandy Farmhouse has been developed but the other two sites for 23 dwellings (which are
geographically close) have not been brought forward.
The Local Plan does not preclude development on suitable windfall sites and, on average, there have been
about five completions on windfall sites each year since the Local Plan was adopted.11 These include seven
affordable units across three of the off-islands (St Agnes, St Martin’s and Bryher). They also include a number of
self-build units which can provide a route into home ownership for islanders at a more affordable price.
Development at the Carn Thomas school site in Hugh Town would be another windfall opportunity – this time
on a brownfield site. The Carn Thomas site is well located in relation to other facilities in Hugh Town, is a
suitable site for a range of (smaller) housing types including flats and can meet the needs of a range of
households, including older households.
Together, the outstanding Local Plan allocated sites, the Carn Thomas site and other small windfall schemes that
arise total approximately 50 dwellings. This means that provision for only 40 to 70 dwellings would need to be
found over the next 10 years to achieve the Housing Growth Plan’s very provisional figure of 90-120 new
dwellings. Priority for these dwellings can be given to other brownfield development opportunities and infill
sites before any new greenfield development need be considered.
No specific initiatives are proposed for the off-Islands by the Housing Growth Plan but local communities may
want to bring their own proposals forward – especially if linked to economic growth.
!
Isles of Scilly Council, AMR December 2012
11
12 Isles of Scilly Housing Growth Plan7. FUNDING FOR HOUSING
Headlines
There is very limited grant funding available to provide affordable housing in the future and new sources of
subsidy will need to be identified. This can include cross-subsidy from open market housing.
If open market housing is provided then there will need to be strict controls (through the planning system)
regarding who can purchase the housing, and this should form part of the Local Plan policy.
Open market housing can include equity share which reduces the cost of purchasing (especially for first-time
buyers) and is an option that needs to be worked up locally.
!There is an ongoing need for affordable housing on the Islands and it is expected that a high proportion of the
new homes developed over the next 10 years will be affordable housing e.g. Affordable Rent and low-cost
home ownership.
In the recent past, new affordable housing has been largely funded by public subsidy from the Homes and
Communities Agency (HCA). Development costs are higher on the Islands than on the mainland and this
increases the amount of grant required. Based on our knowledge of development economics, we have
estimated that, at a minimum, a grant of around £110,000 would be needed to develop an Affordable Rent 2
bedroom flat or 3 bedroom house. This is without any consideration of the cost of land. £110,000 is about
five times the average grant per dwelling provided by the HCA for Affordable Rent in Cornwall in recent years
(about £22,000).12
For the current funding programme (2015-2018) the HCA has made clear that it will assess future bids for
funding on a value for money basis. While the HCA may be sympathetic to the additional costs of
development faced on the Islands, the difference in requirement for subsidy between the Islands and the
mainland, could be difficult to justify in a competitive bidding situation.
The HCA’s Prospectus for their 2015-218 programme emphasises the importance of offering value for money
when applying for a grant: “bidders who . . . are able to offer good value for money for the grant funding requested
are likely to be advantaged . . .”
To secure grants and fund affordable housing in the future, it will be important to identify other sources of
subsidy to add to any HCA grant. This could be money that the council itself can invest or the potential for
cross-subsidy from market housing in mixed-tenure schemes. There are no other public sources of funding for
housing delivery that are available at this time.
The Local Plan currently precludes development of open market housing because it is not considered to meet
the main local need (for lower-cost accommodation) and because it can add too easily to the second home
stock and/or letting market.
This is an issue faced by other areas where development is severely constrained but where the authority wants
to allow some market housing to take place, both for economic reasons and to provide cross-subsidy for
development of affordable housing. This kind of policy can be found in the Local Plans of National Parks. A
typical example is set out below, from the draft Local Plan of Exmoor National Park (published November
2013). This is a shortened version.
HC-S3 Local Occupancy Criteria!
1. New housing will be in accordance with Policy HC-S1 and in the case of 2 a) will be occupied in
accordance with the following local occupancy definition by a person(s) (and their dependents) with a
proven housing need who meets one or more of the following:
Schemes confirmed by the HCA: April 2011 - December 2013. HCA website March 2014
12
13 Isles of Scilly Housing Growth Plana) a minimum period of 10 years permanent and continuous residence in the parish or an adjoining
parish who cannot afford (to rent or buy) accommodation in the locality and is forming a household
for the first time or is currently homeless or living in otherwise unsatisfactory accommodation;
b) a minimum period of a total of 10 years permanent residence within parishes within the National Park
and who can demonstrate a clear link with a parish or its adjoining parish who cannot afford (to rent
or buy) accommodation in the locality and is forming a household for the first time or is currently
homeless or living in otherwise unsatisfactory accommodation; or . . .
e) needs to live close to their place of work or meets the requirements of an Exmoor worker in the
parish or an adjoining parish and who cannot afford (to rent or buy) accommodation in the locality.
And later
6. For privately owned dwellings the definition of local need shall initially be based on criteria 1 (a) to (e)
above. . . .The planning obligation will allow, where properties become vacant, other local persons with a
minimum period of 5 years permanent and continuous residence in the parish or an adjoining parish or with
strong local ties to the relevant district council area of the National Park, or the National Park as a whole to
occupy the dwellings.
Another example of local occupancy criteria being applied to market housing is found in the Lake District
National Park.13 The National Park Authority does not permit open market housing but does permit ‘local
needs’ housing which is market housing limited to purchasers with a defined ‘local connection’.
Local occupancy of market housing can be secured either through a Section 106 agreement or a planning
condition.
The advantages of this type of approach are:
• Some market housing can take place to help deliver affordable housing without subsidy;
• Some market housing can take place to support defined economic objectives;
• With a restricted market for sale, market values tend to be lower than equivalent properties without
local restrictions.
The disadvantages of this type of approach are:
• Once occupied, it is not feasible to enforce the local occupancy criteria if the purchaser’s circumstances
change;
• Local occupancy can be enforced on subsequent resales but this requires policing to enforce;
• Mortgages are more difficult to obtain with a restricted market.
Similar criteria already operate on the Isles of Scilly when new private housing is developed for local people.
But the Housing Growth Plan proposes two new elements: first, that occupancy criteria are included in policy,
and second, that occupancy criteria are applied to any new open market housing. The details of an occupancy
policy need to be relevant to the Isles of Scilly but as illustrated above, there are various examples of policies
that can be drawn on for this.
A further option open to the Council is to combine local occupancy restrictions with some form of equity
share product (e.g. an open market sale home available at, say, 60% of open market value). This would provide
some intermediate market housing available only to people who met the occupancy criteria. The option needs
considerable further investigation and testing but does offer a way of meeting a market need that is currently
unmet.
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Housing Provision Supplementary Planning Document. March 2014
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14 Isles of Scilly Housing Growth Plan8. TOWARDS AN ACTION PLAN
The key issues highlighted by the analysis of the Islands’ housing market are:
• Very limited supply of both affordable housing and market housing at prices local people can afford
• Lack of a ‘middle market’ and low-priced market housing for households who want to get on the housing
ladder
• New housing needing to play a clear role in supporting sustainable economic growth
• Limited new development opportunities - but with a mix of redevelopment sites and outstanding Local
Plan allocations
• Economic difficulties in delivering Local Plan policies (with its emphasis on affordable housing and very
limited prospects for public subsidy to support this)
• Meeting the needs of an ageing population – most of whom are owner-occupiers
In responding to these issues, the Housing Growth Plan sets out a series of actions. Some actions are about
defining choices and deciding on priorities, so that the best use is made of the resources (people, land and
money) that are available.
1. Government guidance requires local planning authorities to take a whole-market approach in making
their plans and identifying their housing targets. This will mean a rethink for the Council, whose plans
were drawn up under much earlier guidance. With this in mind, a provisional figure of 90 to 120 new
homes has been identified; these should be planned for over the next 10 years to meet local demand
and support the planned economic growth. A range of types and tenures of housing is required,
including affordable housing for local young people who want to get on the housing ladder and
specialist provision for older households as well as incoming key workers and entrepreneurs. The
provisional figure needs to be tested through improved evidence.
2. Priority for new development should be on brownfield sites and other windfall opportunities, e.g. Carn
Thomas School redevelopment in Hugh Town. The other priorities for development are the sites
already allocated in the Local Plan which have not been built out (at Telegraph).
3. Given the limited opportunities for new housing and the wide range of demands for the housing, the
type and tenure of the new supply should be planned as an integrated package and not on a ‘first come,
first served’ basis. Realism is also needed about how new housing will be funded.
4. The Council, working with its key partners (the Duchy of Cornwall and active developing housing
associations) needs to review alternative approaches to delivery of market housing and explore:
a) The minimum level of sale housing required to maximise delivery of affordable housing;
b) The need for new policies to help ensure that ‘local needs market housing’ does actually meet local
needs – both from within the community and to support new and existing business opportunities;
c) Whether there is a role for shared equity within the mix, e.g. at a fixed percentage of the open
market value.
5. A rapid review needs to be undertaken to identify what size of dwellings should be planned for. This
will reflect the growing number of smaller households (especially of older persons) but also the need
for family accommodation amongst the local community. When considering what local needs market
housing is to be provided, this could include the opportunity for a small number (say 4 to 6) of larger
properties attractive to entrepreneurs but with controls in place to minimise the risk of these becoming
second homes.
6. The approach to key worker housing should be continued but the Council and other major employers
of key workers should consider developing their own key worker housing (for rent). This would be on
a very modest scale (say 4 to 6 flats in a single scheme) but it would assist in maintaining a supply of this
housing, so that working on the Islands remains attractive. The ideal opportunity would be a windfall
site in the existing urban area.
15 Isles of Scilly Housing Growth Plan7. The analysis of the population structure shows that there are a large number of older people who are
mainly homeowners. But there is limited information with which to plan for future provision and to
deliver an integrated strategy that includes both market and affordable provision, meeting the different
types of care needs, and which is fundable. Further evidence gathering is needed but with the aim of
developing an integrated housing and care strategy that covers all aspects of housing for the elderly.
8. With the recent developments of affordable housing, there is no identified need or argument put
forward for new housing on the off-islands over the next 10 years. However, this should be kept under
review, allowing for any locally driven initiatives.
9. The Council can strengthen its evidence base with additional information about the population and
housing delivery. This could include:
a) Population and household projections – especially to identify the potential number of young
households and older households in the population;
b) Evidence of the type of local demand for market housing (price and size of dwelling);
c) Information about the economics of development and the balance between affordable and local
market housing needed to get the housing developed;
d) Developing policies to support new local market housing so it does not slip into the second
homes market and which offers local people the opportunity to afford to purchase, e.g. through
equity share. Regarding the latter, the Council will need to investigate which organisations could
invest in the share of the equity that is not purchased (this could include the Council itself).
10. The Housing Growth Plan has indicated a new direction for some aspects of the Islands’ housing and
planning policies. These will get picked up in any future Local Plan review but, in the meantime, the
Council needs to make clear any changes to the way it implements its Local Plan policies. Producing a
Supplementary Planning Document may help with this and would be an opportunity to ensure the
community could have their say. However, it must be recognised that SPD is not a substitute for a
policy review.
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16 Isles of Scilly Housing Growth PlanThese actions are in addition to the ones shown in Annex 1 - Key Actions, and relate to the technical
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requirements for creating new housing policies.
Key actions Potential lead Delivery Potential benefits Scale of costs
partners timescale
Produce a strengthened evidence Council / Duchy /
6 months Provides improved data to Local staff
base housing associations / refine the policies and resources and
local agents targets set out in the specialist
Growth Plan demographer
An improved evidence base would help answer a number of detailed questions that the Growth Plan has identified and only partially
answered. This includes refining the overall 10-year target, being clearer about the size, type and tenure of dwellings required and
highlighting the needs of the elderly.
Identifying what level of market Council / housing 6 months Provides essential Local staff
housing is needed to fund future associations information to inform resources
affordable housing future policies and ensure
they can be delivered
Information about the amount of market housing required to produce affordable housing will help inform future housing targets and
ensure that new affordable housing does get built
Update the Housing Growth Plan Council / Duchy /
6 months Sets out an integrated Local staff
(and find a mechanism to turn into housing associations / package of housing for the resources
policy) local agents next 10 years
A refined Housing Growth Plan which sets out what new housing is needed, where and when will provide certainty and transparency.
It will ensure that the scarce resources of land and money are used to best effect. It is essential that this brings together planning,
housing and economic interests.
Deliver the growth programme Council / Duchy /
10 years (but Implementation of the Local staff
and review annually housing associations / annual review agreed Growth Plan resources but
local agents / local and full review could involve direct
builders after 3) investment by
Council and others.
Cost unknown
There will be a range of actions under this heading including, for example, providing development briefs for development sites, putting
together development prospectuses, employers working together to provide worker housing schemes, and marketing local market
housing to potential entrepreneurs.
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Key actions Potential lead
Potential Benefits Scale of costs
(Cap / rev)
17 Isles of Scilly Housing Growth PlanYou can also read
